A FAIR GLOBALIZATION: CREATING OPPORTUNITIES FOR ALL phần 5 potx

To take advantage of the opportunities of global-ization, and ensure that they are widely and fairly distributed among different groups within nations, there is a need for effective poli

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The governance of globalization

225 The goals set out in our vision require concerted action on a wide front The major thrust of our proposals for action relate to improving the governance of the global economy We believe that globalization has vast potential for increasing eco-nomic efficiency and growth and thereby for delivering ecoeco-nomic prosperity to all nations and people But, as our preceding analysis has shown, we are still far short

of fully realizing these potential benefits

226 A basic reason for this is that the current process of globalization lacks effec-tive and democratic governance Some essential market-supporting and regulatory institutions are missing, making the system prone to various market failures More-over, the rules and institutions that do exist are unfair towards poor countries, both in the ways they were drawn up and in their impact This is compounded by the weakness of mechanisms for redressing the vast inequalities between and within countries, and for delivering on important social priorities such as the pro-vision of global public goods16 and social protection

227 In a world of nation States, the governance of globalization is bound up with governance at the national level To take advantage of the opportunities of global-ization, and ensure that they are widely and fairly distributed among different groups within nations, there is a need for effective political and legal institutions, strong economic and technological capabilities, and policies which integrate eco-nomic and social goals More generally, well governed countries, whose domestic policies take into account the needs of other countries, will be more effective part-ners in bringing about a fair and more inclusive process of globalization This is why the response to globalization can be said to begin at home

228 We therefore start, in section III.1, by examining the instruments and options that governments and key national actors have available to strengthen national in-stitutions and policies, with a view to improving their social and economic per-formance in the context of globalization This calls in the first instance for action

at the national level But we believe that a fairer globalization also needs action and empowerment at different levels – in local communities and economies, and in the rapidly developing new forms of regional cooperation and integration We exam-ine some of the key issues at each level

229 We then turn, in section III.2, to the large and complex agenda for the reform

of global governance We first lay out the analytical framework for the governance

of globalization that is the basis for our subsequent recommendations It highlights the deficiencies in the current system of governance and the unbalanced outcomes resulting from these In doing so, it also identifies the key reforms that are required

230 In section III.2.2 we address the first of these areas for reform, the current rules governing the global economy We argue that there is a need for greater fair-ness and balance, both between and within countries and especially between rich and poor countries This includes both the unfairness of some of the rules that do exist for the multilateral trading and financial systems, as well as the negative im-pact of the absence of adequate rules in areas such as international migration

231 Next, in section III.2.3, we set out our proposals for a more equitable and co-herent set of international policies covering development assistance and the

16 For example the control of communicable diseases, protection of the environment and global security.

Part III Page 52 Friday, April 16, 2004 2:46 PM

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achievement of global social and economic aims These policies exert a major in-fluence on the distribution of the benefits of globalization and its impact on pov-erty We highlight, in particular, the urgent need to substantially increase resources to meet global goals, to ensure that there is consistency and coherence between economic and social objectives, and to give higher priority to the goal of decent work for all

232 Finally, in section III.2.4, we examine key institutions of the current system

of global governance, and the role of the main actors concerned We suggest steps which can be taken to strengthen the capacity of the multilateral system to address the social dimension of globalization by making it more democratic, coherent and accountable, and to mobilize all actors – both State and non-State – to support this process

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III.1 Beginning at home

National capabilities and policies Empowering the local level Regional integration as a stepping stone

233 All nations are increasingly interdependent, and we urgently need better and fairer global rules, policies and institutions But before coming to those essential questions, we must start at home People experience the problems and opportuni-ties of an increasingly interconnected world, often different for women and men, within their own communities and countries Policies within nations continue to

be a key factor in determining whether or not countries and people benefit from globalization We need to examine the means and instruments available to govern-ments, and to social actors within countries, to enable citizens to participate effec-tively in the gains of globalization and to protect and provide assistance when adjustments are required

Beginning at home Governments must manage change

234 Globalization leads to economic adjustment in all countries, industrialized and developing New economic opportunities emerge, but they may demand new skills and appear in new locations Relocation of production between countries can destroy jobs in one place and create employment in others Whole regions where production is concentrated in declining sectors suffer, while others benefit from new opportunities Governments need to manage these changes, in coordi-nation with key social actors – supporting adjustment and new opportunities, em-powering people through participation and skills and protecting citizens from insecurity The challenges are especially daunting for many developing countries where institutions, capabilities and infrastructure need to be built while simultane-ously facing an increasingly competitive economic environment

235 While each national situation is different and there is no universal policy agenda, some issues recur The following sections explore the contribution of democratic governance, the need for strong State capabilities to manage the proc-ess of integration into the global economy and the challenges of the informal econ-omy We look at investment in education, work and employment, and the need for coherence among economic, social and environmental goals

236 This is not only a national agenda How people set and meet their goals and aspirations depends to a large extent on their immediate economic and social en-vironment Successful policies to respond to globalization need to start with local

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communities Their empowerment is a central element in any strategy for making globalization work for people

237 Finally, coordination among countries at the regional level offers an addi-tional route to expand capabilities and strengthen institutions We look at the role that regional integration can play in achieving a fairer pattern of globalization

National capabilities and policies

Governance

Good governance

is the foundation

238 We strongly believe in the fundamental importance of good governance in all countries at all levels of development for effective and equitable participation in the global economy The basic principles which we believe must guide globaliza-tion are democracy, social equity, respect for human rights and the rule of law.17

These need to be reflected in institutions, rules and political systems within coun-tries, and respected by all sectors of society

239 Poor governance is manifested in a host of interlocking problems that have appeared in varying combinations and degrees in different countries Examples in-clude dysfunctional States torn apart by civil strife, authoritarian governments of various hues, and States with democratic government but severe inadequacies in terms of the policies and institutions required to support a well-functioning market economy In the most extreme cases there is little hope for improvement without international action and assistance In others, where the basic preconditions for democratic governance are in place, there is considerable scope for bringing about improvement through national effort

Good governance

is built on democracy, the rule of law, and equitable social and economic institutions

240 The basis for good governance is a well-functioning democratic political sys-tem that ensures representative and honest governments responsive to the needs

of people This involves more than simply the holding of regular, free and fair elec-tions It also implies respect for human rights in general, and notably for basic civil liberties such as freedom of expression and of association, including a free and plu-ralistic media Every effort should be made to remove obstacles to the growth of representative organizations of workers and employers, and to fruitful social dia-logue between them In addition, proactive measures are needed to promote the growth of representative organizations of the poor and other socially disadvan-taged groups These are fundamental conditions for the development of a vibrant civil society that reflects the full diversity of views and interests They are all means

to ensure participatory processes of policy design and implementation, and pro-vide continual checks and balances on the exercise of governmental authority and private power

241 The rule of law and the effective administration of justice is the foundation

An equitable legal framework, applied consistently to everyone, defends people from abuse of power by the State or by non-State actors It empowers people to as-sert their rights – to property, education, decent work, freedom of speech and other “springboards” for human growth and advancement Meanwhile, efforts are needed at both national and local level to ensure that the law is respected and

17 “We will spare no effort to promote democracy and strengthen the rule of law, as well as respect for all internationally recognized human rights and fundamental freedoms, including the right to de-velopment”, United Nations Millennium Declaration, 2000.

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applied, and that all citizens, rich and poor, have the access, knowledge and resources to use it This requires transparent and accountable government institu-tions at executive, administrative and parliamentary levels, as well as independent judiciaries Public monitoring of budgets, contracts and procurement is also crucial – a role which is mainly the responsibility of parliaments, but in which employers’ and workers’ organizations, and representative CSOs also have an important part

to play

242 The need for good governance also extends to the formal institutions re-quired for the efficient and equitable functioning of a market economy The basic requirements include a sound financial system that mobilizes savings and promotes investment, the regulation of markets to prevent abuse and anti-competitive behav-iour, mechanisms for ensuring transparent and socially responsible corporate gov-ernance, and an effective system for delineating property rights and for the enforcement of contracts Without such institutions, countries are highly disadvan-taged in access to global financial markets Labour market institutions, including appropriate legal frameworks, freedom of association, and institutions for dialogue and bargaining are also essential in order to protect the fundamental rights of work-ers, provide social protection and promote sound industrial relations Social dia-logue is an important component of good governance, and an instrument for participation and accountability Means are also required to ensure that the in-equality of income and wealth remains within acceptable limits so that social co-hesion can be strengthened

243 One important aspect of national governance is the need for countries to ad-equately take into account the impact of their domestic policies on others In an interconnected world, the economic policies of the major players in the global economy have a substantial impact on all other countries Those countries with greater decision-making power in international bodies also have a special respon-sibility to consider all interests in the global market place There is also a wide-spread failure to live up to commitments and agreements reached in the global United Nations conferences of the 1990s, especially where these involved financial resources.18

Poor governance

is widespread

244 All countries are afflicted by some forms of poor governance In the public sector, the accountability of public servants and public administrations is often in-adequate in both high- and low-income countries.19 Meanwhile in the private sec-tor, poor corporate governance has become an issue of major concern The enormous abuses in 2001 and 2002 by the management of Enron, Worldcom and Global Crossing were possible because of poorly functioning boards and deficient auditing and accounting practices Corruption is widespread in many developing countries, where it is especially detrimental to the poorest who are excluded from services and are subject to arbitrary treatment And industrialized countries are by

no means corruption-free.20 Moreover, corrupt practices in developing countries too often involve counterparts from developed countries willing to offer substan-tial bribes

18 For example, see the annual Social Watch publications which report on what governments have done to implement the commitments they have made in international fora (www.socwatch.org).

www.transparency.de

20 Transparency International: Global Corruption Report 2003 (Berlin, 2003).

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245 Overcoming such deficiencies is a major challenge in the quest for improved

economic performance The process of economic transformation in Central and

Eastern Europe illustrates this well The former planned economies of this region

were burdened with institutions unsuitable for the functioning of a market

econ-omy There was a lack of clear laws and judicial institutions to enforce contracts,

and of institutions to manage market entry and exit The implementation of price

liberalization and privatization policies was carried out before the institutions

re-quired for a market economy were in place, diverting effort into rent-seeking and

asset-stripping activities In the absence of open democratic processes, many

insti-tutions, including parts of the State, were captured by private interests in the

tran-sition process The result was an extended period of declines in GNP and alarming

growth in unemployment, inequality and poverty The more recent shift of

empha-sis to institutional reform has led to improved economic response, although

progress is uneven

Economic liberalization and the State

Policies to manage economic liberalization must be tailored

to differing circumstances

246 The economic policies adopted by countries in their quest for success in the

global economy have often involved far-reaching liberalization of trade, investment

and financial policies This has been associated with collateral liberalization of the

domestic economy involving privatization, a reduction in the role of the State in

economic management and regulation, and a general expansion in the role of the

market Starting in some industrialized countries in the early 1980s, the model has

now been adopted in very diverse economic and social contexts

247 Policies for market liberalization must recognize the importance of the point

of departure – the differing situations of industrialized and developing countries,

the pre-existing policy and institutional environment, and the state of the economy

and of the external economic environment at the time the policies are applied

Otherwise, there is no guarantee that liberalization policies will yield the

univer-sally positive outcome its advocates foresee On the contrary, the results are likely

to be mixed, with positive outcomes in some cases and strongly negative ones in

others

248 An important issue is the pace and sequencing of the liberalization process

In the past, a “big bang” approach to liberalization was often advocated and

some-times applied This involved liberalization across the board, carried out

simultan-eously Today, it is generally recognized that this was a mistake The supporting

institutions and regulatory frameworks required for a market economy need to

be developed gradually, and require strong public administrative capacity The

comparison between Eastern European and East Asian experiences of reform is

instructive

Role of the State

in managing economic fluctuations and in macro-economic policy

249 This highlights the important role of the State in managing the process of

in-tegration into the global economy, and in ensuring that it meets both economic

and social objectives This role includes the provision of classical public goods

which have positive externalities such as health, education, and law and order; the

supervision of markets and the correction of market deficiencies and failures; the

correction of negative externalities such as environmental degradation; the

provi-sion of social protection and safeguarding the vulnerable; and investment in areas

of public interest where private investment is not forthcoming These essential

functions of the State need to be maintained in the context of globalization In

many parts of the world, the problem is the weakness of State action in these areas,

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and the absence of any realistic expectation that private provision can fill the gap Another important role of the State lies in limiting the impact of globalization on income inequality, through progressive taxation, wage policies, social pro-grammes and other mechanisms

250 The reduction in the role of the State that has occurred across the world may often have been desirable, but in many cases the pace has been too fast and the balance has tipped too far While State economic intervention in the past may fre-quently have been ineffective or misdirected, globalization has created many new needs which the State now has to respond to This role is especially important to-day in the absence of strong institutions for global governance

Globalization

poses new challenges to the

State

251 The new challenge faced by the State in the context of integration into the global economy can be seen at several levels Financial liberalization exposes coun-tries to greater risks of economic fluctuations, including the devastation that can

be inflicted by financial crises This requires a strengthening of the role of the State

in providing social protection, not its weakening Similarly, the increased mobility

of capital that is associated with globalization strengthens the hand of employers vis-à-vis workers At the same time, labour markets are experiencing a higher rate

of job creation, dislocation and destruction as economies adjust to greater open-ness These have adverse effects on workers in both North and South These labour-related developments underscore the need for a stronger role for the State

in building effective and equitable social safety nets and labour market institutions

252 Another important domain of State action is macroeconomic policy The main objectives of this include: achieving the highest possible rate of economic growth; promoting full employment; and maintaining macroeconomic stability The latter is essential for ensuring that the rates of growth of output and employ-ment are sustainable and protected from the risk of economic crises Macroeco-nomic policy must maintain business and consumer confidence, which requires keeping fiscal deficits and inflation within acceptable proportions However, the objective of macroeconomic stability should not override the other two The pre-ferred policy stance is to seek to achieve the highest feasible rate of output and em-ployment growth that is compatible with macroeconomic stability over the medium term

253 One of the effects of globalization has been to reduce the space for national macroeconomic policy, notably because international capital markets sanction de-viations from orthodoxy However there remain policy instruments to achieve the objectives outlined above The key instrument is the rate of growth of both public and private productive investment in the economy That, together with the need

to strengthen the State, underlines the importance of domestic resource mobiliza-tion and an effective, non-regressive taxamobiliza-tion system It also highlights the need to bring the informal economy into the economic mainstream Taxes which only ex-tend to the formal economy not only lead to revenue shortfalls, they also provide strong incentives for informal work

Wider participation in

the formulation of

economic policies

254 The prospects of realizing the above strategy will be greatly enhanced by cre-ating institutions that ensure wider participation in the formulation of economic policies Such policies are often considered to be the exclusive preserve of tech-nocrats, bankers and financiers But consistency between economic and social pol-icies requires close coordination between all the ministries concerned Moreover, since workers, enterprises of all sizes and many other groups have a strong stake

in the outcomes, existing institutions need to be strengthened and new mech-anisms created to allow their voices to be heard and their interests taken into account

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Strengthening economic capabilities

255 Public investment and policy also have a strategic role to play in

strengthen-ing national capacity to benefit from integration into the global economy, and in

sharing the gains more equitably Partnerships between governments and private

actors – business, trade unions, community organizations, cooperatives and others –

are an effective means to develop the skills, infrastructure, technological and

managerial capabilities, and frameworks that provide an enabling environment for

private investment (both domestic and foreign) in the most dynamic productive

activities This is not about “picking winners”, but establishing the preconditions

for the growth of globally competitive enterprises

Rural development vital

in low-income countries

256 The approach taken to strengthen national economic capability will vary

greatly according to the initial conditions In many low-income countries,

agricul-ture accounts for a large proportion of economic activity and an even higher

pro-portion of employment The majority of the poor (75 per cent) live in rural areas

and the incidence of poverty is highest in countries that are dependent on primary

commodity exports This calls for a series of policies to support agricultural

growth including: the elimination of price distortions and practices which

discrim-inate against some sectors of agriculture; support for niche markets; substantial

public investment in education and health; and recognition of the key role of

women in agricultural production, and therefore in poverty reduction In many

areas the priority is investment in transport networks, electricity and water

man-agement, which increases productivity and security and opens markets

Mean-while, investment in agricultural research, extension services and financial support

is also important Many poor countries need better seeds, less harmful agronomic

practices, and access to new knowledge and techniques It is also vital that

tradi-tional knowledge be protected, used and extended.21

257 At the same time, diversification of the rural production structure is usually

essential Growth of the rural non-farm economy is often hindered because it is

largely within the informal economy While policies required to support this

growth will vary widely, they should generally aim to increase productivity and

ac-celerate learning and technological progress The upgrading of primary production

exports and diversification of the export structure is often a priority

Upgrading skills and technological capabilities

258 Many middle-income developing countries are now competing among

them-selves to export similar labour-intensive manufacturing products to the same

mar-kets As a result they are trading more, but earning relatively less The challenge for

these countries is to move into higher-value exports A strategic response is

needed to promote innovation, adaptation and the learning processes associated

with it.22 Key to the creation of national systems of innovation is the upgrading of

skills and technological capabilities This will both enhance the gains from trade

and participation in global production systems, and expand the domestic market

through increases in productivity and wages Global production systems should

21 The UN Economic and Social Council recently called for a wide-ranging integrated approach to

ru-ral development which develops many of these points See ECOSOC: Draft Ministerial Declaration,

E/2003/L.9 National action can draw on programmes of policy advice, capacity building and

techni-cal assistance undertaken by FAO to support the development of sustainable rural livelihoods and

food security, and by IFAD to enable the rural poor increase their organization, knowledge and

influ-ence on public policy See www.ifad.org and www.fao.org

22 A Amsden: The Rise of the Rest (Oxford University Press, 2001).

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provide opportunities for domestic firms to be engaged in a process of learning and adaptation in both industry and services, closely linked to “world-class” pro-duction experience Policies are also needed to strengthen propro-duction linkages be-tween leading economic sectors and the rest of the economy and to take account

of the needs and constraints of small enterprises Access to financing and financial institutions is particularly critical, as are specialized technical extension services for micro-enterprises and poor women entrepreneurs

259 These issues are no less important for industrialized countries Here too train-ing, financial and technology policies and partnerships can support the phasing out of inefficient old industries and the growth of new high value-added activi-ties.23 Flanking policies for economic adjustment include not only social protec-tion and income security, but also the supportive policies which help create new opportunities, notably in the knowledge economy and new service sectors

260 Agriculture is a particular concern Each nation is of course entitled to de-velop its own agricultural policies, but the excessive support and subsidies to this sector in many OECD countries illustrate how domestic policies can fail to ade-quately take into account the implications for other countries Policies for this sec-tor should be designed with the livelihoods of poor farmers in both industrialized and developing countries in mind, and reward rural producers for delivering pub-lic goods such as environmental services Presently, in OECD countries only 4 per cent of support is targeted to environmental objectives

The informal economy

The informal

economy is large

and growing

261 In most developing countries there is a large informal economy, where eco-nomic activity lacks recognition and protection under formal legal or regulatory frameworks It typically consists of small-scale manufacturing, services or vending

in urban areas, domestic work or agricultural work on small plots of land In many

of the lowest-income countries it accounts for the large majority of workers There

is often a high proportion of women workers This work is very diverse, ranging from small enterprises to survival activities, including not only the self-employed and family workers but also wage labour in many forms Typically such activities are of low productivity, and poverty levels among informal workers are high But there is also a large reservoir of entrepreneurship and innovation Informal work is less prominent in industrialized countries, but by no means absent, and includes the informalization of previously secure wage employment

262 Like poverty, the informal economy long predates globalization But it is growing In many parts of the world today the bulk of new employment, both self-employment and wage work, is informal As seen above, how far this is due to glo-balization is hard to establish, but the increased competitive pressures in global markets have not made informality any easier to control At the same time, while some informal workers provide low-cost inputs to global production systems, the majority are excluded from the opportunities of globalization and confined to re-stricted markets

23 At the Lisbon European Council in March 2000, the European Union set itself a new strategic goal

the world, capable of sustainable economic growth with more and better jobs and greater social cohesion.

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263 This is a major governance issue, with a considerable impact on the

distribu-tion of the benefits from globalizadistribu-tion First, the lack of rights and protecdistribu-tions leads

to vulnerability and inequality, undermining many of the principles of governance

outlined above Second, there is lack of access to markets and services, so that

po-tential for growth and development is unrealized Third, there is a failure to build

a fair and participative economy, for the rules of the game are in effect not the

same for all Since private initiative and entrepreneurship will only thrive if people

feel that the law is on their side, there is a need to set clear rules which are applied

equally to all members of society

Policies to help raise productivity and shift informal activities to the formal sector

264 The goal must be to make these informal activities part of a growing formal

sector that provides decent jobs, incomes and protection, and can trade in the

in-ternational system This will be an essential part of national strategy to reduce

poverty That means increasing assets and productivity, appropriate regulatory

frameworks, raising skills and ensuring that policy biases are removed Policies to

deal with the lack of recognition of qualifications and skills, and the exclusion of

informal workers from social security and other protections are particularly

impor-tant So too are policies to improve the distribution of assets, and especially to

increase access for self-employed women and men and small businesses to

finan-cial resources, technology and markets, and to increase opportunities for

invest-ment But most workers and economic units in the informal economy have

difficulty accessing the legal and judicial system to enforce contracts, and their

ac-cess to public infrastructure and benefits is limited A variety of bureaucratic and

other restrictions create barriers and difficulties which hinder formalization,

growth and sustainability.24

265 A fundamental problem is the lack of an adequate legal and institutional

framework for property rights Up to 4 billion people are effectively excluded from

participation in the global economy because their property rights are not

recog-nized They are thus deprived of the legal identification, and the forms of business

that are necessary to enter the global market place In reality their assets – notably

land and housing – are worth enormous sums But this is “dead capital”, because it

generally cannot be used as loan collateral, discouraging credit and investment

Failure to deal with this issue frustrates the potential for growth and development

of millions of small enterprises And it encourages low quality economic activities,

which fall outside the tax net.25

Governments should take steps

to establish property rights and ensure gender equality and core labour rights

266 The legalization of de facto property rights is therefore a vital step in the

transformation of the informal economy To achieve this, governments need to:

• identify the people and the assets concerned;

• identify the practices and customs which govern the ownership, use and

transfer of these assets, so as to root property law in the prevailing social

con-text;

• identify administrative, bureaucratic and legal bottlenecks and obstacles to

market access;

24 See ILO, Decent Work in the Informal Economy, Report VI, International Labour Conference,

90th Session (Geneva, ILO, June 2002) for a review of a wide variety of policy issues concerning the

informal economy, including legal frameworks, standards, financing and governance questions.

Everywhere Else (New York, Basic Books, 2000).

Tiêu đề	A Fair Globalization: Creating Opportunities For All
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